In the dynamic business hub of Singapore, not every incorporated company stays active 365 days a year. Whether you are taking a strategic pause, protecting a brand name, or holding assets for future use, your company may enter a state of “dormancy.”
However, “dormant” does not mean “invisible.” In 2026, regulatory oversight remains stringent. At Hallmark Corporate Services, we help business owners understand that while the compliance burden is lower for dormant companies, missing a single filing can still lead to personal fines for directors.
1. The Dual Definition: ACRA vs. IRAS
Crucially, a company can be “dormant” to one authority but “active” to another. You must satisfy both definitions to fully minimize your compliance work.
A. ACRA’s Definition (The “No Transactions” Test)
Under the Companies Act, ACRA considers a company dormant if there are no accounting transactions during a financial period.
- Allowed Transactions: You can still pay for a company secretary, maintain a registered office, and pay ACRA filing fees/penalties without losing your dormant status.
- Forbidden Transactions: Selling goods, buying assets, issuing dividends, or taking loans will immediately trigger “active” status.
B. IRAS’s Definition (The “No Income” Test)
For tax purposes, IRAS defines a company as dormant if it has no revenue or income, even if it has incurred expenses (like bank charges or secretarial fees).
- Key Difference: You can have expenses and still be dormant for IRAS, but if you have even $1 of interest income from a bank account, you are “active” in their eyes.
2. Core Compliance Rules for 2026
Even if your company is in hibernation, you must fulfill these baseline legal requirements:
- Appoint a Company Secretary: You must retain a resident company secretary throughout the dormant period.
- Maintain a Registered Office: Your company must still have a physical Singapore address for official notices.
- File Annual Returns (AR): You must file an AR with ACRA within 7 months of your Financial Year End.
- Prepare Financial Statements: Most dormant private companies are exempt from preparing full financial statements if their total assets do not exceed S$500,000.
3. Exemption: The “Waiver to Submit Income Tax Return”
By default, every company—dormant or active—must file a tax return (Form C-S/C) by 30 November each year. However, you can apply for a Waiver of Income Tax Return Submission if:
- The company is dormant and has filed all past tax returns.
- It does not own any investments (e.g., shares or real property) that generate income.
- It has no intention to resume business within the next 2 years.
- It has de-registered for GST (if previously registered).
Pro Tip: Once granted, this waiver is permanent until your company resumes business. You won’t have to file a tax return again until you “wake up” the company.
4. Resuming Business in 2026
If you decide to reactivate your company, you must notify IRAS within one month of earning your first dollar of income. You do this by submitting the “Request for Income Tax Return and Notification of New Financial Year End” via the myTax Portal.
Conclusion: Avoid the “Dormancy Trap”
Many directors mistakenly believe that “dormant” means “no paperwork.” This is a costly error. In 2026, ACRA’s automated systems quickly identify non-filers, leading to composition sums starting at S$300 and potential court summons.
At Hallmark Corporate Services, we can manage the maintenance of dormant entities for a fraction of the cost of active ones. Do you need a consultation?
Is your company currently inactive but still receiving filing notifications? Would you like us to apply for your IRAS tax waiver and handle your 2026 ACRA filings?